Goldman Sachs adds Kodiak Gas and Williams to dividend‑paying

Kodiak Gas Services (NASDAQ:KOD) and The Williams Companies (NYSE:WMB) were singled out by Goldman Sachs as dividend‑paying data‑center power stocks, with the firm’s price targets suggesting potential gains of roughly 36% for Kodiak and 27% for Williams versus their recent closes【2】.

Dividend appeal and growth outlook

Goldman’s analysis notes that both companies are expanding into “behind‑the‑meter” power generation—a model where data centers generate or store energy on‑site, reducing strain on the grid. For Kodiak, the firm projects roughly 15% EBITDA growth through 2030, driven by its core natural‑gas compression business and the new behind‑the‑meter projects, including a multiyear agreement with Baker Hughes for gas turbines and generators【2】. The Williams Companies are similarly positioned, with recent announcements of three behind‑the‑meter projects—Neo, Atlas, and Silve—targeting hyperscalers and large data‑center customers, which Goldman believes the market is underestimating【2】.

Market reaction and valuation context

Shares of Kodiak have surged about 75% year‑to‑date, outpacing the broader market, while the consensus among the 15 analysts covering the stock is a buy or strong buy, translating to an implied 27% upside. Goldman’s $89 target price pushes the upside estimate to more than 36% from the Friday close, indicating a higher conviction in the stock’s upside potential【2】. For Williams, Goldman’s target of $89 (implied) also suggests a 27% upside, aligning with the consensus view and reinforcing the dividend‑plus‑growth narrative.

Why the dividend angle matters now

Both stocks offer yields well above the S&P 500’s 1.04% dividend yield, providing income in a market where investors are seeking higher‑yielding assets amid modest equity returns. The combination of dividend income and the growth prospects from behind‑the‑meter projects creates a risk‑adjusted return profile that Goldman highlights as “compelling risk/reward at current levels” within its broader “Ten Buys” energy list【2】.

What to watch

• Upcoming earnings releases for Kodiak (Q3) and Williams (Q2) to gauge whether EBITDA growth and behind‑the‑meter project pipelines meet Goldman’s expectations.
• Any further agreements with equipment suppliers like Baker Hughes that could accelerate behind‑the‑meter deployments.
• Changes in data‑center power demand trends, especially from hyperscalers, which could affect the revenue outlook for both firms.

Goldman’s focus on dividend‑paying data‑center power stocks underscores a broader shift toward income‑generating assets with growth upside, but the actual performance will hinge on the execution of behind‑the‑meter projects and broader data‑center energy demand.